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Committee hears bill to clarify sales/use tax exemption for broadband equipment to encourage rural deployment

2289437 · February 11, 2025
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Summary

Representative Ben Baker sponsored House Bill 743 to clarify that equipment used with broadband grants and deployments is exempt from sales and use tax. Broadband providers, industry groups and business associations testified the change removes deployment barriers and preserves grant dollars for infrastructure.

Representative Ben Baker introduced House Bill 7‑43 to clarify that equipment used to deploy broadband — including equipment tied to grant funds and certain installations — is exempt from sales and use tax. Baker said the purpose is to ensure grant dollars are used for infrastructure and not reduced by tax on equipment purchases.

Witnesses representing business and broadband interests testified in favor, saying the bill would remove ambiguity and speed deployment of rural broadband. Ray McCarty (Associated Industries of Missouri) said the measure clarifies existing exemptions and prevents an "aggressive Department of Revenue" audit stance in the future. Noel Torpy (Missouri Cable Telecommunications Association), Cade Tremaine (Missouri Chamber of Commerce), Tracy King (AT&T), Bill Gamble (Missouri Broadband Providers Association), Mike Sutherland (Missouri Electric Cooperatives) and gateway fiber and local providers all supported the bill; several said equipment used for telecommunications is already exempt but the statute needs updating to reflect modern broadband use and to protect deployment grants.

Witnesses said the change would help leverage federal funding now available for broadband expansion in Missouri, specifically referencing upcoming federal BEAD funds. Industry witnesses emphasized the bill would free up dollars for construction and increase the state’s ability to reach unserved and underserved locations.

No opposition testimony was recorded in the transcript; committee members asked brief procedural questions about the scope and whether installation services were included.